Ads keep this website free for you. does not research or endorse any product or service appearing in ads on this site.  Before making a major financial decision you  should consult a qualified professional.

Eligible Pension Income
Canadian Tax and
Financial Information Home

What's New

Links & Resources

Site Map

Need an accounting, tax or financial advisor? Look in our Directory.  Use above search box to easily find your topic!   Stay Connected with!


Home  ->  Filing Your Return  -> Pension income tax credit -> Eligible Pension Income and Qualified Pension Income

Income Tax Act s. 118(3), 118(7)

Eligible and Qualified Pension Income for the Pension Tax Credit

Eligible Pension Income

Eligible pension income includes qualified pension income (see below) and, for taxpayers who are 65 or older in the year, the following pension income:

bullet life annuity payments from a superannuation or pension plan, including life income funds (LIFs) and locked-in retirement income funds (LRIFs)
bullet payments from a RRIF, which includes life income funds (LIFs) and locked-in retirement income funds (LRIFs) (and any reference to a RRIF always includes spousal RRIFs)
bullet annuity payments from an RRSP or from a deferred profit sharing plan (DPSP)
bullet certain payments on the termination or winding-up of a DPSP
bullet regular annuities and income averaging annuity contracts (IAAC) reported in box 24 of a T4A or box 19 of a T5
bulletsince tax year 2010, annuity payments from the Saskatchewan Pension Plan (SPP), a voluntary locked-in defined contribution pension plan available to Canadians in all areas, not just Saskatchewan.

The above types of eligible pension income are eligible for pension splitting. See also our Pension Splitting article, which includes an additional 2 types of pension income as eligible pension income for purposes of pension splitting only.

Qualified Pension Income

For taxpayers who are less than 65 for the entire year:

bulletlife annuity payments from a superannuation or pension plan
bullet payments from a RRIF, or annuity payments from an RRSP or from a DPSP, which have been received as a result of the death of a spouse or common-law partner
bulletsince tax year 2010, annuity payments from the Saskatchewan Pension Plan (SPP)

Quebec Pension Splitting

The June 4, 2014 Quebec Budget announced that taxpayers under 65 would no longer be able to split pension income for provincial income tax purposes, as of January 1, 2014.

Foreign Pension Income

Foreign pensions which are reported on line 11500 of your tax return may qualify as pension income, except

bullet the portion of foreign pension which is tax exempt due to a tax treaty, and can be deducted from income on line 25600 of the tax return
bullet see the Canada Revenue Agency topic Line 25600 - Exempt foreign income, and the web page on Tax treaties.
bullet income from a U.S. individual retirement account

Tax Tip:  If you have pension or annuity income which is reported on line 11500 or 12900 of your tax return, it may qualify for the pension income tax credit and for pension splitting with your spouse.

Income Not Eligible for Pension Tax Credit

Income that does not qualify as pension income for the pension income tax credit:

bullet Old Age Security or Canada Pension Plan benefits
bullet Quebec Pension Plan benefits
bullet death benefits
bullet retiring allowances
bullet RRSP withdrawals except for annuity payments
bullet payments from salary deferral arrangements, retirement compensation arrangements, employee benefit plans, or employee trusts

Also see the Canada Revenue Agency (CRA) web page on Line 31400 (line 314 prior to 2019) Pension income amount, which includes a section where you can answer questions to determine if you are eligible to claim the pension income tax credit.

Back to Pension Income Tax Credit

Revised: January 02, 2024


Copyright © 2002 Boat Harbour Investments Ltd. All Rights Reserved.  See Reproduction of information from

Facebook  | Twitter  |  See What’s New, stay connected with by RSS or Email
The information on this site is not intended to be a substitute for professional advice.  Each person's situation differs, and a professional advisor can assist you in using the information on this web site to your best advantage. 
Please see our legal disclaimer regarding the use of information on our site, and our Privacy Policy regarding information that may be collected from visitors to our site.